WASHINGTON (7/26/12)—Credit unions and mortgage loan originators (MLOs) that registered with the Nationwide Mortgage Licensing System & Registry (NMLS) last year must complete their annual Secure and Fair Enforcement for Mortgage Licensing Act (SAFE Act) independent testing by the end of this year, the Credit Union National Association (CUNA) said in a recent Comp Blog post.
According to Comp Blog, some credit unions noted that Federal Reserve Board-supervised institutions were required to complete their annual SAFE Act testing by July 29, 2012. Credit unions have questioned whether this deadline also applied to them.
However, CUNA Director of Compliance Information Valerie Moss noted in her Comp Blog post, the National Credit Union Administration's position is that "annual" means within a calendar year; similar to the agency's requirement for an annual Supervisory Committee audit. In other words, testing may be performed any time in the calendar year and does not have to be completed by July 29.
Financial institutions and their residential MLOs were required to complete initial NMLS registration by July 29, 2011. MLOs that are not registered on the NMLS are prohibited from originating residential mortgage loans.
The SAFE Act requires independent testing of a credit union's policies and procedures for complying with the act, and related implementing regulations, "at least annually." Testing may be conducted by credit union personnel or outside parties.